“Spectrum in 700 Mhz band can also be used to launch 5G services. All bands are Technology-neutral as of now. Service providers can use any band for any Technology and it all depends on telcos which band they choose,” Telecom Regulatory Authority of India (Trai) secretary Sunil K Gupta told ET.
He said that the 700 MHz band — whose starting price was cut by some 43% from the last sale — already has a developed ecosystem for both, 4G LTE and 5G services. This time around, Trai has cut base price of 700 Mhz frequencies to Rs 6,568 crore a unit from Rs 11,485 crore per unit in 2016 which failed to attract buyers.
The top official is also optimistic that private service operators would be showing keen interest in purchasing 5G airwaves in the 3300-3600 MHz band which will be sold for the first time in India.
“5G will be having great potential and positive revenue model, and service providers will be inclined to go forward for 5G spectrum to launch services,” Gupta said.
Telecom lobby group Cellular Operators Association of India (COAI) that represents Bharti Airtel, Vodafone India, Idea cellular and Reliance Jio have said that 5G spectrum auction should happen only around the second half of 2019 by which time telcos could stabilise from their current financial stress and the 5G handset ecosystem could develop further.
The regulator last week proposed to auction nearly 300 MHz in the 3300-3600 MHz band which is earmarked for 5G services.
Gupta believes that 5G is an upcoming Technology which is expected to be launched by 2020-2021, and considering ultra-high speed broadband, Machine-to-Machine (M2M) offerings and newer applications, spectrum in the 3300-3600 MHz would be important for the provision of high-speed bandwidth services.
India Ratings and Research (Ind-Ra) Tuesday though said that telcos may have limited participation in the 5G spectrum auctions due to their high leverage levels and their existing capex priorities.
Gupta also rejected criticism that the proposed base price of Rs 492 crore per megahertz for 3300-3600MHz band was high. Analysts have said the price is far higher compared with South Korea which has recently auctioned 3.5 GHz and 28 GHz bands for 5G services at a price of about Rs 65 crore per unit.
“Price depends on various factors. International pricing in countries where auction has happened and other things were taken into consideration,” Gupta said, adding that it has taken account of spectrum utilization in respect to population density and average revenue per user (ARPU).
Trai, according to him, has in fact taken a cautious approach and benchmarked pricing with international standards, and also consulted other regulators working in the similar area which has led it to take additional time to come out with a proposal.
Gupta also said that the Department of Telecommunications (DoT) would take a call on suitable timeframe for the next sale.
“Time of auction is neither called for nor recommended. Government is in a best position to look into it (time), and timing was not included in the reference made to Trai,” he said.
Trai’s proposal, if it gets the government approval, would be the country’s biggest ever spectrum auction in terms of quantum of airwaves which is more than three-fold higher the size of airwaves put on sale earlier.
Catch all the action in the 5G space at ETTelecom’s upcoming event The 5G Congress 2018